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People's Force questions vehicle tax hike amid fuel price surge

The People's Force questioned the vehicle tax increase ordered by the Dominican tax authority and denounced asymmetric fiscal indexation: the marbete rises…

--- The context --- The Economic Affairs Secretariat of the People's Force questioned the increase in the Vehicle Circulation Tax, known as the marbete, ordered by the Internal Taxes Directorate. In its view, the measure reveals an asymmetric fiscal policy: the Government uses inflation to recover the real value of its revenue without applying the same criterion to protect taxpayers' income. --- The facts --- Economist Haivanjoe Ng Cortiñas, head of the secretariat, pointed out that the adjustment, established through Administrative Resolution No. DDG-AR1-2026-00009, was justified by accumulated inflation of 58.1% between September 2016 and September 2026. The measure raises the tax from RD$1,500 to RD$2,000 for vehicles manufactured up to and including 2021, and from RD$3,000 to RD$4,000 for those from 2022 onward: an increase of 33.3%. The authority estimates revenue will rise from RD$3,525 million to RD$4,700 million in the 2026-2027 season, with additional income of RD$1,175 million. Ng Cortiñas acknowledged that a tariff frozen for ten years may require revision, without a full pass-through of inflation: a complete update would have set RD$2,372 and RD$4,743. --- The positions --- The economist warned, in reported terms, that if the Government recognizes that inflation reduced the real value of the marbete and uses that argument to charge more, it must also recognize that the same inflation eroded Dominicans' purchasing power, and that inflation cannot be a unilateral indexation mechanism for the State. He recalled that Article 327 of the Tax Code establishes the annual inflation update of income tax brackets, not applied for almost a decade. By that contrast, Law 30-26 raised the exempt minimum from RD$416,220 to RD$480,000 a year starting in 2027, a partial adjustment, because with the same 58.1% inflation it should be around RD$658,000 a year. The marbete is updated immediately at 84% of accumulated inflation; the exempt minimum, by barely 73% and only from next year, leaving the salaried worker around RD$14,800 a month short in exempt income. --- What remains unknown --- The organization asked the Government to make transparent the distribution of vehicles by category, the effective impact on households and the criteria used to set the new tariffs. It also noted that mandatory salary adjustments concentrated on private-sector minimum wages, without a general mechanism protecting workers' real income. --- Unanswered questions --- Will the Government apply the same inflation criterion to income tax brackets that it used for the marbete? Will it publish the distribution by category and the impact on households? Will a discussion open on general mechanisms to protect workers' real income? --- EPM analysis --- The increase arrives amid a sustained fuel escalation: according to official weekly prices, between January 2026 and the week of October 24 to 30, premium gasoline rose 23.4%, regular gasoline 16.5%, optimal diesel 31.4% and regular diesel 20.5%. The secretariat warned that fixed amounts are regressive: a used vehicle worth RD$400,000 will pay 0.5% of its value, while a RD$5 million vehicle manufactured in 2021 will pay barely 0.04%, hitting independent workers, drivers, merchants and small business owners hardest. 📌 EPM Take: In EPM's view, the debate opened by the People's Force raises a demand for fiscal coherence that is hard to dismiss: if accumulated inflation of 58.1% justifies immediately updating what the State charges, the same reasoning should protect what workers earn. The proposal to fully apply Article 327 and compensate the unrecognized inflation in income tax brackets moves the discussion onto the ground of equity, transparency and predictable rules, where the Government will have to respond with public figures, clear criteria and a calendar that treats collection and protection by the same measure.
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